NM Live: Back to School Campaigns and How to Leverage Them for Black Friday

Drew Sanocki

Hey, everybody. Welcome to the Nerd Marketing podcast. It's summer in New York. It's like 90 degrees, which is a great time to, you know, talk about Q3 and Q4 things you could do now to get a leg up on your competition and prepare for Black Friday and also nail back to school, which is sort of this like cool little holiday at the end of the summer that allows you to pregame Black Friday in a number of ways. So don't want to miss it. The Nerd Marketing Podcast coming at you from New York City where it's 90 degrees.

Michael Epstein

Hey, Drew.

Drew Sanocki

Hey Mike, happy summer.

Michael Epstein

It's yeah, it's June here. Kids are off of school. Getting ready.

Drew Sanocki

One kid is off school, the other kid is still in school and hating it that she's still in school for another month. Yeah.

Michael Epstein

Yeah, New York goes a little later. San Diego is out a little earlier. So my kids have been off and getting ready to head out to camp for a month.

Drew Sanocki

That's awesome. And you've got a lot of travel plan or some travel plan this summer.

Michael Epstein

A little bit, going to Japan in July, that's our one major trip.

Drew Sanocki

That's awesome. Well, have you thought any about Black Friday?

Michael Epstein

I was going to say, I mean, it is June, so top of mind for all marketers right now is Black Friday. 

Drew Sanocki

Yeah, it's like one of those things that like, typically, I used to start thinking about it. I mean, this is totally dating myself. But back in the day, I'd start thinking about it like late September. And I mean, that you've seen the date kind of get earlier and earlier when people need to start preparing for it. I mean, in those days, I was running a drop ship business. So it wasn't about taking inventory. But certainly, if you've got inventory, I think you're thinking about it now. You think about what to put on promotion and when.

Michael Epstein

Everybody always says, need to start thinking about Black Friday over the summer. Whether you actually do that or not is maybe a question, but I think The biggest mistake that we see with brands using PostPilot in particular is they wait until Black Friday period to actually test different new channels or new strategies. And if you're not, you might not have to think about your Black Friday promotion right now in June, but what you need to be doing right now is doing the experimentation to get some validation around what strategies, what channels, what messaging, what products, things like that are driving the best response so that you have all this data heading into Q4 and then it can scale the hell out of it in Q4.

Drew Sanocki

Yeah, I think Q4 is the worst time to test because everything's expensive. You've got tons of competition. Everybody's bidding up, you know, the ad prices and every platform. There's a lot of competition in the inbox, right? That's not the time to test. The summer is the time to test. The next retail holiday is when we've got the 4th of July and we've got back to school. Like use these two periods to test campaigns that I think ultimately, you want to double and triple down on in Q4.

Michael Epstein

Yeah, you're absolutely right. And that, raises the other point about not testing in Q4 because a test sort of by definition is very conservative. You're, you are going to do a small budget and get some data points. But The problem with doing that in Q4 and specifically around Black Friday is you couldn't, you, you run out of time to scale the winners. Like by the time you understand what worked Black Friday is over and you just left a ton of money on the table because you didn't scale when you had the best opportunity to because you didn't have the data that you could have gotten way ahead of time.

Drew Sanocki

I think Black Friday is unique for two reasons. First, most brands get an incredible surge in traffic, right? You're going to see it on your site, your email signups, everything goes through the roof. And then second, that traffic converts higher than it has in the past. They've got their credit cards out. So it is not the time to test. It is the time to capture. You're out there to capture demand as much as you can. It's not a brand building time. It's a capture time. And you want all your channels cranking. And you want to make some strategic bets that really can make or break your year.

Michael Epstein

Totally agree. what would be your number one test to run now over the summer before Black Friday to get some of those learnings?

Drew Sanocki

Well, I think we're in an interesting position because we run a direct mail platform. Right. And so. Now, this is the channel that a lot of us have seen historically, a lot of brands say they want to start testing in Q4. I want to test because they realize almost too late that the inbox is crowded and met as expensive. And it's like, OK, I think I should probably fire off a direct mail campaign.

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And there are lot of strategic reasons why you'd want to lean in on direct mail in Q4. The price of postage is capped. That's probably the biggest reason. It's like What it costs you now in the summer to acquire a customer and to bring that customer back to purchase might essentially be the same as what it costs in November. So that's one big reason. And the other is zigging when everybody else sags. Your competitors are going to be stuffing in the inbox. They are going to be on Meta. They're going be bidding up prices. the physical mail inbox is not going to be as crowded. And you have a chance to stand out there and convert higher. So it's a great time to test direct mail now in June and in July. And we want to talk about the number one thing you can do to test direct mail.

Michael Epstein

What is the number one thing, Drew?

Drew Sanocki

So the number one thing you can do now in the summer to test direct mail to prepare for a killer Black Friday is what we call a recency test. So everybody comes to us November 1st and says, hey, let's pull back some of our existing customers. Now's a good time. I'm going to look into my database. I've got customers going back five years. I want to pull them back to buy. And then they crack open Klaviyo or Omnisend and they say, wait a minute. Only 10 or 20 % of these, this massive audience is actually opening my emails. So until direct mailing, you you probably said, I can't target that other 80%, but now you know with direct mail can. But you typically don't want to go back as far as your customer file exists. Like at some point, if you could imagine from the most recent customer, the customer who bought yesterday, all the way back to the earliest customer, whoever purchased, you you line up all your customers at some point in there, it's going to be, it's going to, it's going to start out very profitable to market to them. And then the profitability is going to decrease with increasing recency for the most recent purchase. And eventually it's going to shift to be negative. And you're no longer, you know, it's no longer the marginal cost of going to customers that are more, you know, less and less recent after that point goes up, right? It's gone. Yeah. And so, you know, I had a brand come to me the other day that said they have a couple million customers in their customer file, what can they do now to test direct mail? Like, we don't want to drop a mail piece to all of them. And that's probably true. You don't want to do it yet, right? What you want to do is you want to bucket your customers. And the number of buckets will typically depend on how big your customers are in the overall recency. But take, for example, 90-day buckets. In other words, bucket one is people who ordered over the last 90 days. Bucket two is day 90 to 180. Like they haven't been around in three to six months. Right. And you just bucket all your customers going out. You can do it every 30 days. You can do it every 90 days, whatever. and then you want to drop a nice sample of a campaign, the same campaign into each bucket, thousand carts, right? And you're going to typically see, Hey, this 90 day bucket, zero to 90 days had a killer ROI because they know, you know, the, addresses are all correct. They just, didn't move. They ordered from us last week. They know our brand. Of course they're going to take the coupon or they're going to take the promotion. You know, maybe it's a 20 X row as, and then the next bucket will be a little bit less than that. And it's going to keep decreasing until the point where you say, OK, this is no longer profitable given our margin structure. So we call that a recency test. Very easy to set up. Bucket your customers. Send a sample of the overall number of customers. We can chart out, and you can see how that ROAS decrypts. We can chart out and show how that ROAS declines with increasing time since the most recent purchase. And then when Q4 comes around, you basically want to send en masse to everybody who's profitable before that point. What you think of the recency test? You explain a recency test again, because that'll give us another, this will give us another video clip. like, Mike, what's a recency test and why do all brands want to play around with it right now this summer?

Michael Epstein

A recency test is testing into different customer cohorts based on how long it's been since they last purchased. And what you're going to see is that performance declines over time, but you want to figure out where that inflection point is of profitability. And for some brands, you might be able to target people who've not purchased in six months. And then after that, it's not profitable anymore because they're too far gone. For other brands, you could target four years or five years and still profitably reactivate customers at that time. The key is learning which cohorts are profitable for you and which aren't and testing into them with a modest budget now so that you can scale into them later. And so you will set up your test where we create these different buckets of people who haven't bought in six to nine months and nine to 12 months and 12 to 18 months and so on and track each of them in a real time dashboard. So you can see how they perform and you'll see that typically recency is the biggest indicator of performance. And so it will, you will see it start to decline as you go further and further back. But again, for you can, you will be very surprised by how far back you can actually go and profitably reactivate a dormant customer. And getting that learning now with a small test means you can scale to the moon over other peak periods like Q4. And you can even further segment those people by frequency as well, because you might find that somebody who only bought from you once, you can profitably reacquire them or reactivate them at eight, at six months. But somebody who's bought from you twice, maybe you can go back a year or two years. So that recency test and mixing that also with some frequency cohorts is going to give you really clear validation as to what is profitable and what you can start to scale with in the holiday period. And you can also apply the same thing to some of your leads, your prospects people who've signed up for your email list, but still never bought from you and apply the same strategy where you look at people who've signed up for your email list 30 days ago and still not bought from you 60 days ago and still not bought from you 90 days and still not bought from you. can match those email addresses to a postal address with a high degree of accuracy, even if you don't have their postal address and then get them to convert off that card because clearly by definition, they have not been engaging with or converting off your email list. So there's a ton of low hanging fruit there as well. And you apply the same strategy. Just test into these different cohorts now, learn what works, and then scale them once you validated that.

Drew Sanocki

So Mike, you can do essentially two kinds of RFM bucketing. RFM recency and frequency off of transactional data, off of the order table. And you can do it off of subscriber data and the subscription date, treating that as a transaction. But the reason we want to do these recency tests, mean, one comes to mind.

Michael Epstein

Exactly.

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Drew Sanocki

This was an eight or nine figure brand on post pilot that did one, want to say going back five years. And it shows the like literally what you would expect with the the ROAS off the charts for the most recent cohort going all the way to the point where it was ultimately negative. And that's something we can certainly show when we edit the video. We'll put the we'll put the screen grab there because it's pretty compelling. You're going to have a report like that armed with that, why do you want to do this? This isn't just an intellectual exercise. Like you do that because that's an insight on your customer data that no one else has. Now as a marketer, you know who you can market to, who's going to respond to your promotion going into Black Friday and who isn't. And what you're ultimately going to find out is it's way more profitable once you've got that recency data to go back and market to existing customers and people on your email list versus essentially lighting money on fire, trying to acquire new customers on Meta during that time period.So be a smart marketer. Run a recency test this month. We can do one for you at PostPollitt. It's easy. It's designed to minimize your testing budget and maximize your learnings. So yeah, DM us, and we'll tell you more about how to set up a recency test. All right, Mike. Another thing we're talking about a lot around the office is back to school. I know it's only June. The kids don't like hearing me talk about back to school because it depresses them. But fact is, if you're a marketer and you are somewhat related to selling into families, now is the time you want to be thinking about back to school. It's the next big retail holiday for you.

Michael Epstein

Absolutely. You want to be launching, you want to be thinking about strategies and working on that creative now. So you launch it sort of late July, mid to late July, give people time to act on it.

Drew Sanocki

Right. So we were putting together, you know, from running back to school campaigns for the last four or five years, we've got four or five tips, I think that, you know, marketers need to be thinking about right now in June to help them nail their back to school season. And Mike, the first one I think is a targeting tip. know, there's a lot of things you can do with direct mail targeting that will help a brand that is trying to, you know, nail their deck, their back to school campaigns. And could you tell us a little bit about targeting?

Michael Epstein

Yeah, so we have, as we've talked about many times, thousands of data points on hundreds of millions of consumers in our proprietary data set. And a lot of those attributes are things around parents, how old the children they have in the household, how old those children are, the gender of those children, the types of products they buy. They're an organic food shopper who visits Target twice a month and has two kids under the age of five and buys luxury apparel. So we have all of that data and we can get really, really targeted with your acquisition campaigns if you are selling into that market of parents or children. So if you're not testing into this, again, like the data that we have on these types of audiences is really, really powerful. Definitely makes sense to test into that.

Drew Sanocki

Awesome. The second tip is around format. So back to school to me is typically like it's not really announcing a lot of the stuff that you already sell. A lot of it, especially in apparel, is about a new collection. It's about launching something into the fall. And so we find that these smaller format cards, you know, maybe the four by six are not as good for back to school as something a little larger. I've got a six by nine here from Bombus. And then of course, the Cartalog, which I have here from HexClad, a big trifold where you can really display your whole offering. So there's this rule of thumb in direct mail. If you want to increase conversions, put more product and more selection onto the piece. And so you have trouble doing that with a four by six. But with the larger format pieces, certainly you can display more of your collection, increases the likelihood of getting a conversion, often costs the same as something, putting more products on is the same cost as putting one product on a six by nine. So take advantage of the larger real estate and add some products, show off your new collection, use some of the targeting that Mike talked about. And it's sort of the recipe for a killer back to school campaign.

Michael Epstein

Yep. What's your third tip, Drew?

Drew Sanocki

The third tip is first of all, think retention. So everybody out there is putting together, uh, promotions and some thought and some merchandising into their back to school campaigns. You're probably working on the creative now in your email software. And it's just, Hey, the realization that I had many years ago, that that campaign and that effort will only go to like 10 to 20 % of your total customers in Klaviyo or in Omniscent, right? Like where you've got, say, 100 % of your previous buyers are in there, but only 10%, 20 % are active and opening your emails. In other words, the other 80 % have never subscribed, they've unsubscribed, or they aren't seeing it, or they aren't opening it, right? And so you can run this analysis yourself, go into Klaviyo, go into Omnisend, go into Sendlane, create two segments, one of all previous buyers from your company. The second one only only show me those previous buyers who have opened an email in the last 90 days. And you're going to see it for yourself. You know, it's I've seen it's typically 20 percent right that are opening. So what a win it is to get the other 80%. Like you're already doing the heavy lifting. You're doing the thinking about the promotion, the merchandising, you know, the offer that's all going into an email campaign right now that you're going to send out at the end of the, uh, the end of the summer. Take that same creative, flip it to our team at post-pilot. We'll get it into a direct mail campaign that essentially mirrors your email campaign. And you're just getting much more mileage off of it. So think about retention when you go back to school. It's a great opportunity to not just get that 20 % of your previous buyers, but get the whole hundred percent and, leaning on an acquisition, sorry, and leaning on a retention campaign. All right, Mike, the fourth and final direct mail tip for going into back to school is to get into one of our shared mailers. So what's a shared mailer? Essentially, we share the real estate on a trifold in a catalog among a number of different brands. They are complementary and not competitive with each other. And we generate one audience, one target audience. We can do a little bit of lookalikes off those brands. We can also sprinkle in some of the direct mail attributes you mentioned earlier, but come up with a killer audience. And then we drop that shared mailer into those households, often for pennies to reach a household. Why is that compelling? Because it essentially gets the cost down. It's low cost new customer acquisition because the brands are sharing the cost of that mailer. And it's also, I mean, it's hyper-targeted. We put a lot of content on there around back to school. We make it really compelling, almost like a back to school catalog. So if you're not a brand that wants to sort of dominate and buy out an entire catalog yourself or do your own dedicated mailer, the Shared is a really interesting product to sort of get your cack down over that holiday.

Michael Epstein

Yeah, especially over with really targeted audiences like parents with young children. It tends to work really well again because the cost is so low. You don't need a massive conversion rate to get a strong return.

Drew Sanocki

Yeah, our back to school shards always do well. So DM us, we'll get you into the cycle there and explain a little bit more. They're filling up fast. And those are four great ways to sort of hack back to school.

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